* Shares in Shunfeng surge for second session on bid
* Bid's success will depend on talks with creditors -source
* Wuxi Suntech has $1.75 billion in debt
* Size of Shunfeng's bid is not known
(Adds details, context and quotes)
By Charlie Zhu
HONG KONG, Oct 10 Chinese solar panel maker
Shunfeng Photovoltaic International Ltd has been
chosen as the preferred bidder for a stake in the main unit of
troubled rival Suntech Power Holdings Co Ltd, according
to a notice issued by China's Wuxi government.
Shares of Shunfeng surged more than 13 percent on Thursday
morning, adding to a more than 20 percent gain on Wednesday
after the company said it had submitted a bid.
A source close to the situation said the success of the bid
would depend on whether Shunfeng could strike a debt
restructuring deal with Wuxi Suntech's creditors.
Amid a worsening glut in solar panels globally, Wuxi Suntech
filed for bankruptcy protection in China in March, five days
after its New York-listed parent company defaulted on a $541
million dollar convertible bond. The unit has $1.75 billion in
Shunfeng won the auction by beating out its only rival
bidder - a consortium led by Wuxi Guolian, the investment arm of
the city government of Wuxi where Suntech is headquartered,
according to the government notice seen by Reuters.
The value of the bid is not known. Shunfeng has made a 500
million yuan ($82 million) deposit on the offer, which is aimed
at strengthening its solar cell and module manufacturing
capability and aiding its diversification into the operation of
solar power plants.
Representatives for Shunfeng and Suntech Power were not
immediately available for comment.
(Editing by Edwina Gibbs)